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STRENGTHENS POSITION IN FAST-GROWING ENERGY SERVICES MARKET
Acquisition Highlights:
Baker continued, saying, "The deal is terrific financially as well. Like
our current Nalco Global Energy Services business, Champion offers very
attractive growth and an annuity-like revenue model generating steady
and predictable earnings patterns similar to our legacy
The transaction is expected to close by year-end and be cash and
earnings accretive in 2013, the first full year of the combined entity.
Baker concluded by saying, "This transaction enables us to make an important strategic investment in one of our key growth businesses, and we will continue to further develop our core strengths in food safety, healthcare, water and energy as we further build our business. We are excited by the improved position and opportunities Champion brings us to better serve our customers, grow our business, and to deliver continued strong shareholder returns."
Third Quarter Forecast Update
About
With 2011 pro forma sales of
About Champion Technologies
Champion Technologies is a global specialty chemical company with 3,300 employees in more than 30 countries delivering innovative and engineered programs for upstream, midstream, and downstream oil and gas markets. CorsiTech is a global specialty chemical organization dedicated to meeting and exceeding customers' technical needs in the drilling, stimulation and completion markets.
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Cautionary Statements Regarding Forward-Looking Information
This communication contains certain statements relating to future events and our intentions, beliefs, expectations and predictions for the future which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Words or phrases such as "will likely result," "are expected to," "will continue," "is anticipated," "we believe," "we expect," "estimate," "project," "may," "will," "intend," "plan," "believe," "target," "forecast" (including the negative or variations thereof) or similar terminology used in connection with any discussion of future plans, actions or events generally identify forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding benefits of the Champion acquisition, integration plans and expected synergies, the expected timing of completion of the acquisition, credit ratings impact from the acquisition, future cash flow and debt repayment, anticipated future financial and operating performance and results, including estimated third quarter earnings per share, second half 2012 free cash flow and net income, synergy estimates and timing and benefits of the acquisition, future earnings per share and cash flow accretion, returns of invested capital, debt repayment, stock repurchases, investments and future acquisitions and estimates for growth. These statements are based on the current expectations of management of the company. There are a number of risks and uncertainties that could cause actual results to differ materially from the forward-looking statements included in this communication. These risks and uncertainties include (i) the risk that the regulatory approvals or clearances required for the acquisition may not be obtained, or that required regulatory approvals may delay the acquisition or result in the imposition of conditions that could have a material adverse effect on the company or cause the company to abandon the acquisition, (ii) the risk that the conditions to the closing of the acquisition may not be satisfied, (iii) the risk that a material adverse change, event or occurrence may affect the company or Champion prior to the closing of the acquisition and may delay the acquisition or cause the company to abandon the acquisition, (iv) problems that may arise in successfully integrating the businesses of the company and Champion, which may result in the combined business not operating as effectively and efficiently as expected, (v) the possibility that the acquisition may involve unexpected costs, unexpected liabilities or unexpected delays, (vi) the risk that the credit ratings of the company may be different from what the company currently expects, (vii) the risk that the businesses of the company or Champion may suffer as a result of uncertainty surrounding the acquisition and (viii) the risk that disruptions from the transaction will harm relationships with customers, employees and suppliers.
Other unknown or unpredictable factors could also have material adverse
effects on future results, performance or achievements of the company,
Champion and the combined business. For a further discussion of these
and other risks and uncertainties applicable to the company, see the
company's Quarterly Report on Form 10-Q for the quarter ended
Non-Solicitation
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
Non-GAAP Financial Information
This news release includes financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S. (GAAP), including adjusted diluted earnings per share, adjusted EBITDA and free cash flow. We provide these measures as additional information regarding our operating results. We use these non-GAAP measures internally to evaluate our performance and in making financial and operational decisions, including with respect to incentive compensation. We believe that our presentation of these measures provides investors with greater transparency with respect to our results of operations and that these measures are useful for period-to-period comparison of results.
We include in special gains and charges items that are unusual in nature, significant in amount and important to an understanding of underlying business performance. In order to better allow investors to compare underlying business performance period-to-period, we provide adjusted diluted earnings per share, which excludes special gains and charges and discrete tax items.
Adjusted EBITDA is defined as operating income, before depreciation and amortization, and excludes special gains and charges. We provide adjusted EBITDA as we believe that it is an important measure of operating performance because it allows management, investors and others to evaluate and compare our core operating results from period to period by removing the impact of our capital structure (interest expense from our outstanding debt), asset base (depreciation and amortization), and changes in tax rates. Furthermore, we use adjusted EBITDA for business planning purposes and to evaluate and price potential acquisitions.
Free cash flow is defined as cash from operations less capital expenditures; it is a useful measure of funds that can be used for business investments, strategic acquisitions and to reduce debt.
The non-GAAP financial measures are not in accordance with, or an alternative to, GAAP, and may be different from non-GAAP measures used by other companies. Investors should not rely on any single financial measure when evaluating our business. We recommend that investors view these measures in conjunction with the applicable GAAP measures.
(ECL-A)
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